“Dropshipping! Drop Shipping! Set right up in few minutes! Make money from the comfort of your bed or couch – sit somewhere on the yacht and coordinate your whole business remotely with little effort!” – this is probably what a snake oil salesman would sound like if they were to ever preach drop shipping…
However, setting the preaching aside, there’s something that you should know before you throw yourself into drop shipping and build your whole business around it.
In this complete guide, we’ll cover all the ins and outs of drop shipping as a business model that you should know if you’re considering it the path for you.
What is drop shipping (dropshipping definition)? (overview)
Chances are, if you have an online business, you have heard the term – dropshipping. So what is drop shipping and what can it do for you? Drop Shipping is a quite simple process of selling products without the hassle of carrying inventory or shipping the items yourself. It can be mistaken for an affiliate program, but is quite different. This article will tell you all about Drop Shipping.
In a nutshell, affiliate marketing is a referral service in which you use specialized made banners, buttons and website links to attract customers to a specific site. Affiliate programs will then pay you commission for either someone clicking on your specialized link or by a customer making a purchase. You are simply a referral service.
Dropshipping is very different. Dropshipping is for those with their own website and are looking for products to sell on their site. Drop ship programs allow you to sell as little or as many products as you would like without the worry of carrying inventory, hiring help, physically shipping out products or warehouse storage.
How Does Dropshipping Work?
Drop shipping follows a simple supply chain. The buyer orders a product from your store. You could have a brick-and-mortar store where you have sample items for display or product catalogues for customers to choose from. Or, you could reach more people by having an ecommerce website where your customers can order products. The customer pays for the order he places with you.
You then forward the order details, manually or automatically, to the supplier. Ideally, this supplier must be a manufacturer or a wholesaler so that you can earn a good profit on the difference between the retail price and the price you buy it from the supplier.
The wholesaler charges you for the product, and ships the product directly to the customer. However, the shipment would bear your logo, and not the supplier’s. Thus, the drop shipper is not even known to the customer.
Pros and Cons Of Dropshipping
Pros of Dropshipping
Here are some of the Pros or Advantages of Dropshipping
- No need to pay for the inventory upfront
- No need to have an in-house order management and Inventory Management System
- If the product doesn’t sell, you never have to buy it
- No packing, labeling and shipping cost applied,
- Not there is a need to built a Shipping Management system
- You purchase products at wholesale price and set your own retail price.
Cons Of Dropshipping
Here are some of the Cons or Disadvantages of Dropshipping
- Fraudulent Suppliers
- Some Suppliers take too long to ship order
- Competition level can be High
- A retailer has to bear the loss of defective shipped goods
Is Dropshipping For You?
Dropshipping isn’t a perfect, stress-free way to build a successful business. The model has some definite advantages but comes with a number of built-in complexities and problems you’ll need to be able to address.
With That been said, For me personally, I have been selling online for more 8 years so i have quite some experience in it and that is why am writing about the business- if you do it the right way you can make a boatload of money with it.
There are quite a few things to know though. So if you just start out you need to do a lot of research or if you want to get results fast(we are talking a few days after starting) you should take an online course to educate yourself – get in touch with us through our contact page or the chat interface if you need help setting up your business properly. – We can help you with that.
You need to carefully chose your suppliers and you need to know what to sell and how to do the listings and then how to fulfill the sales.
Once you got the hang of it it is pretty simple and with the training i recommend you get My Premium Step By Step Guide to Dropshipping e toautomation tools which will save you lots of your valuable time.
Picking Your Niche and Market
Another misconception about drop shipping is that you can start in almost any niche imaginable, and that you’ll be able to make it profitable no matter your previous experience.
This is simply not true.
Keep in mind that no matter what market you join, you will come across multiple competitors – competitors that are much more experienced than you, who may have been in this market for years now, and who probably have a much better understanding of the customers and their needs.
The fact that your initial costs are low – due to the drop shipping model – doesn’t mean that you are going to be able to compete with them effectively.
That’s why you really should pick a niche that you know and understand. This will give you some additional advantages over the competitors who might not have invested the same amount of research or personal experiences.
And don’t get me wrong, you don’t necessarily need the seller’s experience in the niche, but the following would help a lot:
- you’re a consumer in that niche yourself – you’ve bought a number of products in that niche, and you understand what’s good/bad about them, and how to make things better;
- you have professional or academic expertise – you’re educated in that specific area, which allows you to approach it from a more professional level;
- you’ve already done research in that niche – even if just among your friends and family, but the point is that you have some first-hand understanding of the target audience;
- you’ve witnessed other businesses in the niche rise and fall, you know the mistakes + how to avoid them;
- and so on.
Having some sort of understanding of the niche will not only help you to compete and cater to your customers better, but it’s also especially important when dealing with your suppliers who send products directly to your customers.
Without any knowledge about the niche, you won’t have the ability to pick up on anything fishy about the quality of the products, the process, the pricing, or anything related (read: you will fail).
Best Platforms to Setup Your Dropshipping Store
Personally, I have used two different platforms among the rest to run my dropshipping business. They are Woo-commerce and Shopify. Both platform are fantastic and do the same thing which is to sell online but they are very different to each other in terms of how they operate. Depending on your website building knowledge, you should be able to pick the right one easily.
My first dropshipping store was hosted on shopify and I learn alot while using the platform. Shopify is hands-down the best platform for dropshipping beginners and experts. I moved my store to WordPress because I am a WordPress expert and I want to use Alidropship Plugin to power my business. So I was confident I can stand alone. Meanwhile, if you are not tech savvy like me, and you don’t want to stress too much on doing all the dirty works for your website, I will strongly recommend you setup your dropshipping store with Shopify.
To use Woocommerce, you need to buy a hosting plan from relieable hosting companies like Bluehost. You can get a hosting plan for as low as $3.95 usd per month and Bluehost will also give you a free custom .COM domain if you buy hosting plan from them. You need a custom domain name for your business. Its cheaper to run your dropshipping business with this method but you must have a good knowledge of running and maintain a website.
Alidropship Pugin has made the WordPress woocommerce dropshipping method become very easy now by providing a turnkey that can turn your WordPress website into a professional ready made eCommerce store with a single click like magic. I use Alidropship plugin turnkey to setup all my dropshipping business now. its amazingly interesting. But with Alidropship plugin setup this way, i can only sell products from Ali-express which is not a problem for me but some merchants want to be able to import from various places and sell on the same website.
See here to discover what Alidropship Plugin can do for your dropshipping business. It might be the perfect dropshipping solution you need.
For most merchants, Shopify is a much, much better choice. Using WordPress/WooCommerce is a nightmare to set up. You need to install WooCommerce API keys, set up payment methods and gateways, install a FB pixel, and so on. If you don’t want to pay a developer, you’d better be prepared to do a hell of a lot of coding. A proper mobile version will require a WP Touch License as well. Plus, there’s no tech support. In other words, if you have an issue with any WP apps, you’d better pray that the app developer replies at some point (some of them are very responsive, to be fair).
Oh yeah, make sure you don’t make any serious mistakes while coding, either. You could get locked out of your WordPress dashboard. Then, you’ll need an FTP Manager to get back in. Of course, if you forget your password, then that’s going to take at least an hour to fix. You might also get cryptic messages such as “error on Line 73” if you make the slightest bloody coding mistake. Now, if you’re good with websites, then I suppose this may not be an issue for you. Anyone good at coding may find WordPress superior since it arguably has more flexibility. But, I’m good with websites. So, using WordPress for my ecommerce to save money was one of the best ideas I’ve ever had.
The main reason is because WordPress isn’t designed for ecommerce. It’s for blogging. It’s free in terms of money, but costly in terms of time. Some might say, “if you know how to set up a proper website, WP is easy!”. Truth is, most dropshippers have no idea what good site design is. So, they’ll most likely end up hating themselves for ever trying to do ecommerce with WordPress. They might even give up on ecommerce altogether because of it.
No one sets up an ecommerce site to spend hours figuring how to fight with codes. They start an ecommerce site to sell and make bank. With Shopify, you have the payment gateway, the checkout page, and the tech support all in one on Day 1. No API stuff required. With Shopify, you can have decent ecommerce site set up in a weekend. Yes, you must pay monthly fees. Sometimes, Shopify apps don’t work properly. However, what you spend in monthly fees, you save in sanity and happiness. And, thanks to your site looking more like a proper ecommerce site, it’s a lot easier to make sales.
Starting a dropshipping business will always be one of the fastest ways of finding success online. That does not, however, make it some get rich quick formula, you have to put in the work just like any other business venture. It takes someone willing to learn and grow as an e-commerce entrepreneur to become successful at dropshipping.
What I have found is that being successful at dropshipping is all about presenting the right products, the right way, to the right people. Follow this three steps and you should be successful at dropshipping. It’s much more productive to learn and create along the way. Your first step is to simply launch your eCommerce store. You can explore ad campaigns and logo designs at a later time, like once your store is up and running.
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